Nintendo has modified its financial projections for the fiscal year ending March 31, 2014. President Satoru Iwata cited disappointing holiday hardware sales, which contributed to the company's third consecutive annual loss.

"We failed to reach our target for hardware sales during the year-end, when revenues are the highest," Iwata said.

Nintendo is modifying its hardware sales projections in response. The Wii U's forecast has been slashed from 9 million units to 2.8 million. The 3DS performed better, but its sales projections are still being cut to 6.6 million units, from the earlier 8 million.

Iwata doesn't appear to be considering a resignation, telling reporters "There will be no major management shake-up in the short term." Last year, when Iwata broke news of disappointing financial results, he said that he felt "greatly responsible" for the circumstances, and there was talk that a repeat performance could be a sign that it was time for him to move on.

It's no surprise that Nintendo missed the overly ambitious 9 million unit mark. When paired with the overshoot on 3DS numbers, a pattern of overestimation starts to emerge. Nintendo needs to start being realistic about the sales potential across the board. It might get a bump from ambitious forecasts, but the fall when it misses impossible goals is that much further. Something needs to change at Nintendo to give the Wii U more traction. Nintendo has rejected additional price cuts in the past, but right now, it's losing out on software sales (which have the best margins) due to a low install base.